Social housing in itself is composed of housing administered by local authorities or Registered Social Landlords (RSLs). Arms Length Management Organisations (ALMOs) are set up by local authorities to manage all or part of their housing stock.
There is no direct impact on rents when an ALMO is set up as the power to set rents remains with the local authority. The Department for Communities and Local Government (DCLG) issues rent setting guidance to all local authorities, whether or not they have an ALMO, on the rent restructuring rules.
Recent housing policy debates in the UK have shifted away from discussion of housing need to more market-oriented analyses of affordability and quality, both of accommodation as well as the services provided by the operator. Social rent setting is a particular issue in the UK and the government is seeking to address it through the rent restructuring policy that is currently being implemented. In the housing Green Paper published in April 2000 "Quality and Choice - a decent home for all", the Government set out its plans for reforming rent setting and rent restructuring in the social housing sector.
Properties managed by a RSL or an ALMO have generally h...
Rochdale Borough-wide Housing Ltd (RBH) is one such organisation, owning and operating social housing in the UK, and this paper discusses the impact of rental policy from their viewpoint. In addition this paper explores the impact that private management of public properties has had on the social housing sector.
The previous Conservative government up to 1997 had a policy of allowing social rents to increase with the intention of reducing public expenditure on subsidies with little regard to the impact on affordability or work incentives for tenants. They argued that rent increases allowed help to be diverted to those in greatest need. Better-off tenants met rent increases out of their own pockets while Housing Benefit 'took the strain' for the poorer tenants. This however, created serious problems of benefit dependency and work disincentives throughout the country.
The present Labour Government has already introduced the national minimum wage and Working Families Tax Credit (WFTC) in order to tackle poverty, promote work incentives and reduce benefit dependency. Realignment of rents in line with this thinking has been taken up on priority.
The Office of the Deputy Prime Minister (ODPM) now changed to the Department of Communities and Local Government (DCLG) [since May 2006] has issued several guidelines on the calculation and setting of rent for different social housing properties.
Since April 2002 rents are calculated according to a formula based on relative property values, local earnings and property size. Restructured rents are calculated using the formula and data set out in the DCLG guide to Social Rent Reforms. Circular R2-27/01: 'Rent Influencing Regime - Implementing the Rent Restructuring Framework' also sets out the calculation of